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TMI Blog2015 (1) TMI 1288X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant firm which were found and inventorised without considering and appreciating the facts circumstances of the case. ii. The ld. Assessing Officer has erred in adding a sum of ₹ 2,77,51,909/- on account of alleged differential surplus/ income on account of transactions indulged into on the basis of certain papers found and seized / impounded at the time of the search /survey action without considering and appreciating the facts circumstances of the case. iii. The appellant craves leave to add, amend or delete the said ground of appeal. The assessee has also raised legal ground/additional ground as follows. on the facts and circumstances of the case as well as in law, the ld. Assessing Officer as well as ld. Commissioner of Income tax (Appeals) has erred in not appreciating the fact that there was no effective notice u/s 143(2) of the Income Tax Act, 1961 and accordingly, assessment order passed u/s 143(3) is bad in law. 2. At the time of hearing, Shri Rakesh Joshi, ld. counsel for the assessee contended that no notice u/s143(2) of the Income Tax Act, 1961 (hereinafter the Act) was issued to the assessee after filing of return of income, therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xport of diamonds, filed its original return showing income at ₹ 13,18,264/-. A survey action u/s 133A of the Act was carried out at the office premises of the assessee on 04/03/2010 which was converted into search. The statement was recorded u/s 132(4) of the Act, wherein no undisclosed income was admitted. Pursuant thereto, assessment was framed u/s 143(3) r.w. section 153A of the Act, wherein the return income was accepted. The assessee did not disclose any undisclosed income for assessment years 2004-05 to 2009-10. In Assessment Year 2010-11, the assessee filed return of income u/s 139(1) of the Act on 26/09/2010 disclosing additional income of ₹ 39,29,046/- on account of unaccounted diamond stock and ₹ 10 lakh on account of profit earned on sales which were not declared in books of accounts. The Assessing Officer issued notice u/s 143(2) of the Act on 17/09/2010 i.e. before the filing of return of income. Later on, notice u/s 143(1) was issued on 20/06/2011. The assessee has challenged the validity of notice on the ground that no notice u/s 143(2) of the Act was issued for the impugned assessment year after filing of return by the assessee by pleading that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... about filing of return u/s 139 of the Ac by the assessee. Then if, the Assessing Officer has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, in that situation, the Assessing Officer has to serve a notice u/s143(2) of the Act specifying particulars of such admissibility and in such notice on specified date, the assessee has to produce the particulars specified for its/his claim. The proviso added to sub-clause (1) to sub section (2) to section 143 explains that no notice under this clause shall be served on or after the 1st day of June, 2003. Thus the Assessing Officer should issue notice u/s143(2) only after filing the return of income by the assessee. In the present appeal, no notice u/s 143(2) of the Act was issued/served upon the assessee after filing of return u/s 139 of the Act. The ld. CIT-DR specifically asked, to prove from the assessment record, whether any such notice was issued/served upon the assessee after filing of return of income. The ld. CIT-DR contended that from the record, no such notice was issued/served upon the assessee. In view of this factual matrix and in the light of the decision fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Hotel Blue Moon (supra) the Hon ble Cour held as under:- If the assessing officer, if for any reason, repudiates the return filed by the assessee in response to notice under Section 158 BC(a), the assessing officer must necessarily issue notice under Section 143(2) of the Act within the time prescribed in the proviso to Section 143(2) of the Act. By Making the issue of notice mandatory, section 158BC, dealing with block assessments, makes such notice the very foundation of jurisdiction. Such notices required to be served on the person who is found to have undisclosed income. Section 158BC provides for enquiry and assessment. After the return is filed, clause (b) of section 158BC provides that the Assessing Officer shall to determine the undisclosed income of the block period in the manner laid down in Section 158 BB and the provisions of Section 142, sub-section (2) and (3) of Section 143, Section 144 and Section 145 shall, so far as may be, apply. This indicates that this clause enables the Assessing Officer, after the return is filed, to complete the assessment under section 143(2) by followng the procedure like issue of notice under section 143(2)/142. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the appeal, that a concurrent finding had been recorded by the Commissioner (Appeals) and the Tribunal on the question of date of service of notice. The notice was not served within the stipulated time. Mere giving of dispatch number would not render the finding perverse. In the absence of notice being served, the Assessing Officer had no jurisdiction to make assessment. Absence of notice was not curable under section 292BB of the Act. Identical ratio was laid down in CIT vs Mukesh Kumar Agarwal 345 ITR 29 (All.) by Hon ble Allahabad High Court by holding that very foundation of the jurisdiction of the Assessing Officer is issuance of notice u/s 143(2) of the Act. Thus, in view of the factual matrix that no notice u/s 143(2) of the Act was issued/served upon the assessee, after filing of return, therefore, the basic mandatory requirement of the Act, is not fulfilled,consequently, the defect is not curable, therefore, the assessment is not valid. 2.6. Since, we have annulled the assessment, therefore, we are refraining ourselves to go into the merit of the case. Finally, the appeal of the assessee is allowed. This order was pronounced in the open court in the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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